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The Oracle: NEPA, PHCN, DISCOs: How Nigerians Pay for Darkness (Pt. 1)

Published

4 years ago

June 11, 2022

Eric

By Mike Ozekhome

INTRODUCTION

THE PHCN OR NEPA

The Power Holding Company of Nigeria (PHCN), formerly known as National Electric Power Authority (NEPA), is an, organization in charge of electricity in Nigeria. The electricity sector in Nigeria currently generates, transmits and distributes megawatts of electric power that is significantly lower than what Nigeria’s required household and industrial needs. In 2012, the industry had labored to distribute a mere 5,000 megawatts, very much less than the 40,000 megawatts needed to sustain the basic needs of the population.

HOW MUCH LIGHT DO WE HAVE?

Nigeria is endowed with large oil, gas, hydro and solar resources, and it has the potential to generate 12,522 MW of electric power from existing plants. This is the estimated quantum of electricity that Nigeria ought to be producing daily with all our numerous endowments. Unfortunately, on most days, we are only able to dispatch approximately 4,000 MW, which is insufficient for a country of over 215 million people (by UN projection), a country boasts of numerous businesses and infrastructures.

MANY SOURCES OF POWER IN NIGERIA

In Nigeria, there are four major sources through which power is provided: coal, hydro, oil (petroleum) and natural gas. Among these, the whole energy sector is dependent only on petroleum, a factor that slows down the production of electricity and development in alternative forms of energy. 45% of the Nigerian population is currently connected to the energy National grid. However, the grid only supplies energy about 85% of the time; and is virtually nonexistent in many parts of Nigeria.

After the privatization of electricity in Nigeria, the transmission and supply of power in Nigeria were divided amongst several companies with different functions. The Generating Companies (GenCos) are those in charge of the actual generation of the electricity; transmission and distribution are left to the Transmission Company of Nigeria (TCN), and the Distribution Companies (DisCos), respectively. The GenCos are tasked with transforming hydro and gas power into electricity power.

HISTORY OF ELECTRICITY GENERATION IN NIGERIA

Electricity was first generated in Nigeria in 1866, when two generating sets were installed in the Colony of Lagos. However, the first electric utility company in Nigeria known as the Nigerian Electricity Supply Company (NESC) was established in 1929. In 1951, the Nigerian government by an Act of Parliament, established the Electricity Commission of Nigeria (ECN), to regulate and operate power supply in Nigeria.

THE EVOLUTION AND REVOLUTION

As part of the evolution in the Power Industry in Nigeria, the Federal Government by Decree No. 24 of 1972, created the National Electric Power Authority (NEPA). This was consequent upon the merger of the Electricity Corporation of Nigeria (ECN) and Niger Dams Authority (NDA). In September, 1990, the partial commercialization came into being with the appointment of a Managing Director/Chief Executive to superintend over the Corporation. Also, the Authority was divided into four autonomous divisions namely: Generation and Transmission; Distribution and Sales; Engineering; Finance and Administration. Each division was headed by an Executive Director.

By the year 2000, a state-owned monopoly, the National Electric Power Authority (NEPA), was put in charge of the generation, transmission and distribution of electric power in Nigeria. NEPA operated as a vertical integrated utility company and had a total generation capacity of about 6, 200 MW from 2 hydro and 4 thermal power plants. This ended up becoming a problem as there was unstable and unreliable electric power supply situation in the country with consumers frequently exposed to power cuts and long period of power outages. It was an industry characterised by lack of maintenance of power infrastructure, outdated power plants, low revenues, high losses, power theft and non-cost reflective tariffs.

In 2001, the reform of the electricity sector began with the promulgation of the National Electric Power Policy which had as its goal as the establishment of an efficient electricity market in Nigeria. It had the overall objective of transferring the ownership and management of the infrastructure and assets of the electricity industry to the private sector with the consequent creation of all the necessary structures required to forming and sustaining an electricity market in Nigeria.

The Federal Government of Nigeria (FGN) thus took further steps towards the Restructuring of the Nigerian Power Sector to establish an electricity supply that is efficient, reliable and cost-effective throughout the country and which will attract private investment. Subsequently, another Power Sector Reform Act was enacted in 2005, transferring the public monopoly of NEPA to Power Holding Company of Nigeria (PHCN) which was unbundled into 18 Business Units (BU); viz eleven (11) Distribution companies:- six (6) Generation companies and one (1) Transmission company .

The Transmission Company of Nigeria (TCN) is one of the successors of the unbundled PHCN and is currently an asset held under the custodianship of the Federal Ministry of Power. It will initially remain publicly owned. TCN has the responsibility for the management of operation, maintenance and expansion of the 132kV and 330kV transmission system. The Bureau of Public Enterprise (BPE) recently appointed a Management Contractor, Manitoba Hydro International (MHI) for TCN which took over the functions of Transmission Service Provider, System Operator and Market Operator to undertake the overall management of TCN.

System Operations (SO) function was established as a sector within the defunct Power Holding Company of Nigeria under t he Transmission sector. The SO has now evolved into a semi-autonomous sector under TCN and upon acquiring its license would operate as an independent company in future. The main responsibility of the System Operator is to operate the transmission system and the connected installed generation in a safe and reliable manner. SO is also responsible for the overall security and reliability of the grid system, economic dispatch of available generation resources and maintaining system stability. SO has seven functional departments namely; Operations/Control, System Planning, SCADA, Communications, Technical Services, Transitional Electricity Market and System Performance. SO is headed by the Executive Director (System Operation). The operational control hierarchy is as follows:

National Control Centre (NCC), Osogbo
Three (3) Regional Control Centres (RCCs) at Shiroro, Ikeja West and Benin. With proposed control centres at Kano, Alaoji and Gombe
Eight (8) Regional Operations Cordinating units (ROCs) at Benin, Enugu, Port-Harcourt, Bauchi, Kaduna, Shiroro, Osogbo and Lagos – several Area Control Centres covering 330kV and 132kV substations which fall under the supervision of the ROCs.

The mission statement was exercising grid control to maintain an efficient, coordinated and economic supply of electricity in accordance with the grid code and operational procedures. The vision was to operate the grid system efficiently to ensure open access, safe, reliable and economic electricity supply

In 2005, the Electric Power Sector Reform (EPSR) Act was enacted and the Nigerian Electricity Regulatory Commission (NERC) was established as an independent regulatory body for the electricity industry in Nigeria. In addition, the Power Holding Company of Nigeria (PHCN) was formed as a transitional corporation that comprises of the 18 successor companies (6 generating companies, 11 distribution companies and transmission company), all created from NEPA.

In 2O10, the Nigerian Bulk Electricity Trading Plc (NBET) was established as a credible off-taker of electric power from generation companies. By November 2013, the privatisation of all generation and 10 distribution companies was completed, with the Federal Government retaining the ownership of the transmission company. The privitisation of the 11th distribution company was completed in November 2014.

Nigeria, known to have Africa’s largest economy, has one of the world’s worst power sectors, producing an average of 5,000 megawatts of electricity for a population of about 200 million since the establishment of its electricity institutions. According to World Bank Report, over 80 million people do not have access to the national grid; and power shortages cost the country $29 billion. By comparison, South Africa, the continent’s second biggest economy, generates about 55,000 megawatts for a population of only about 58 million. Successive governments have tried, but failed to reform Nigeria’s energy sector. The main problems are decaying infrastructure, low investment, debts, and poor management. There are also “operational inefficiencies”, so said PricewaterhouseCoopers (PwC), in a 2020 report.

THE OPERATION OF THE POWER SECTOR

TRANSMISSION

The Transmission Company of Nigeria (TCN) manages the electricity transmission network in the country. It is one of the 18 companies that was unbundled from the defunct Power Holding Company of Nigeria (PHCN) in April 2004 and is a product of a merger of the transmission and system operations parts of PHCN. It was incorporated in November 2005 and issued a transmission licence on July 1, 2006. The TCN is presently fully owned and operated by the government and as part of the reform programme of the government, it is to be reorganised and restructured to improve its reliability and expand its capacity.

TCN’s licensed activities include electricity transmission, system operation and electricity trading. It is responsible for evacuating electric power generated by the electricity generating companies (GenCos) and wheeling it to distribution companies (DisCos). It provides the vital transmission infrastructure between the GenCos and the DisCos’ Feeder Sub-stations. TCN consists of three operational departments:

TRANSMISSION SERVICE PROVIDER (TSP)

The TSP oversees the development and maintenance of the transmission infrastructure. It is responsible for the national inter-connected transmission system of substations and power lines and providing open access transmission services. Its role is to maintain the physical infrastructure that make up the transmission grid and expand it to new areas.

SYSTEM OPERATIONS (SO)

The SO manages the flow of electricity throughout the power system from generation to distribution companies. It operates the Grid Code for the Nigerian Electricity Supply Industry (NESI). The SO has the responsibility for ensuring that the transmission grid lines are reliable and maintaining the technical stability of the grid through its operations of planning, dispatch, and control of the electricity on the grid.

MARKET OPERATIONS (MO)

The MO administers the market rules of the NESI. It is responsible for the administration of the Electricity Market and promoting efficiency in the market. Specifically, the roles of MO include implementing and administering the Nigerian Electricity Market Rules;

drafting and implementing the Market Procedures;

administration of the Commercial Metering System by ensuring that each trading point has adequate metering systems in place;

administration of the Market Settlement System;

Administration of the Payment System and commercial arrangement of the energy market, including Ancillary Services;

supervising Electricity Market Participants’ compliance with and enforcing the Market Rules and the Grid Code. The functions also encompass

periodic reporting on the implementation of the Market Rules;

capacity building of market of Participants on the Market Rules and Procedures and Trading Arrangements, finally,

At the long-term stage of the electricity market, of the MO is to ensuring and promoted competition among market participants.

THOUGHT FOR THE WEEK

“Good governance, safety, a chance to grow economically and professionally – those are important things”. (Dana Perino).

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El-Rufai to Remain in ICPC Custody Till June

Published

2 days ago

April 21, 2026

Eric

Justice Darius Khobo of the Kaduna State High Court has adjourned the bail hearing of former Governor of Kaduna State, Mallam Nasir El-Rufai, to the first week of June, 2026.

El-Rufai is being arraigned on multiple charges bordering on alleged financial crime and abuse of office by the Independent Corrupt Practices and Other Related Offences Commission (ICPC).

“Similarly, another charge, number KDH/KAD/ICPC/01/26, against Mallam Nasir El-Rufa’i and one Amadu Sule (LEDA) has also been filed before a Kaduna State High Court in the Kaduna Judicial Division,” the ICPC said last month.

“The charges in the State High Court case range from abuse of office, fraud, and intent to commit fraud to conferring undue advantage, among others. Both charges were filed by the ICPC on the 18th of March, 2026.”

Speaking after the court session, counsel to the former governor, Ukpon Akpan, kicked against the lingering adjournment of the bail hearing by one presiding judge as politically motivated.

The high-profile case has drawn significant public attention, with heightened security presence observed around the court premises.

The former governor had arrived at the court at about 9 am in a convoy accompanied by ICPC officials and operatives of the Department of State Services (DSS).

During the proceedings, supporters of the former governor gathered outside the courtroom, while security agencies maintained order and restricted movement within the vicinity.

Inside the courtroom, journalists, as usual, were not allowed, as proceedings are expected to focus on arguments presented by both the defence and prosecution regarding the bail request.

At the last sitting, the defence team had maintained that their client poses no flight risk and is willing to comply with all conditions set by the court.

Meanwhile, the prosecution has urged the court to carefully consider the gravity of the charges.

The 66-year-old former governor of Kaduna has been in ICPC custody since February 19 following his release by the Economic and Financial Crimes Commission (EFCC).

El-Rufai, a former minister of the FCT, was, however, released on March 27 based on compassionate grounds following his mother’s death.

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Timi Frank Petitions US, Demands Gbajabiamila’s Resignation over ‘Anti-Democratic’ Remarks

Published

2 days ago

April 21, 2026

Eric

Political activist, Comrade Timi Frank, has called on the United States government to investigate and sanction the Chief of Staff to the President, Femi Gbajabiamila, over alleged actions capable of undermining Nigeria’s democracy.

Frank’s demand followed a viral video in which Gbajabiamila was quoted as telling Hon Leke Abejide, during his wife’s 50th birthday that: “Don’t come to APC. Stay in ADC and scatter them. We like what you’re doing… stay in ADC and win your election… bring Bala Gombe, and we’ll support him. Good luck in court.”

Describing the remarks as “reckless” and dangerous, the former Deputy National Publicity Secretary of the All Progressives Congress (APC), said they point to a deliberate attempt to weaken opposition parties and erode democratic institutions.

“Your statement, as Chief of Staff, raises serious concerns about the determination by President Bola Ahmed Tinubu’s regime to truncate democracy,” he said, adding that “inference can be made that there is an infringement on the independence of the judiciary.”

He warned that any suggestion that courts could be influenced “undermines public confidence in democratic institutions,” citing references to political actors, including Leke Abejide, as requiring clarification to avoid “dangerous interpretations.”

Frank argued that Gbajabiamila’s comments effectively confirm the Presidency’s involvement in crises rocking opposition parties such as the Peoples Democratic Party (PDP), Social Democratic Party (SDP), New Nigeria Peoples Party (NNPP), and the African Democratic Congress (ADC).

“When a Chief of Staff speaks, it reflects the body language of the President. This points to a deliberate attempt to weaken opposition and consolidate power,” he said.

He further claimed that state influence, including the use of the judiciary, is being deployed against opposition parties. “The audacity of the statement suggests nothing will happen even if opposition parties are destabilised. That is dangerous,” he added.

Frank described Gbajabiamila as “an alter ego of the President” who had “displayed the arrogance of power,” insisting that public office holders must uphold restraint, respect for the rule of law and constitutional order.

He also urged U.S. authorities to probe Gbajabiamila’s activities and financial dealings.

“As an American citizen, he should be held accountable. We want to know if he is meeting his tax obligations in line with his earnings in Nigeria,” Frank said, describing him as “a bad ambassador of the United States.”

“We want to be sure that all earnings, including those from official and business engagements in Nigeria, are properly declared and taxed,” he added.

On accountability, Frank insisted resignation was the only honourable option.

“We call for your resignation with immediate effect. If such a statement were made in the United States, the official involved would have resigned forthwith,” he said.

He disclosed plans to petition the U.S. Embassy in Nigeria, stressing that “those entrusted with leadership must reflect humility, constitutional awareness and respect for separation of powers.”

“Power is transient, but institutions must endure. Any comment that diminishes their independence must be corrected,” he added.

The call comes amid rising concerns over the stability of Nigeria’s multiparty system and allegations of increasing pressure on opposition parties.

Comrade Timi Frank is the ULMWP Ambassador (East Africa and Middle East) and Senior Advisor, Global Friendship City Association (GFCA), USA.

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Alleged Coup Plotters Get April 22 Date for Trial, Slammed with 13-Count Charge

Published

2 days ago

April 21, 2026

Eric

The Federal Government has filed a 13-count charge before the Federal High Court in Abuja against a retired Major General, a retired Naval Captain, a serving police inspector, and three others over an alleged coup plot and acts of terrorism.

The alleged coup plotters, are scheduled to be arraigned tomorrow (Wednesday), April 22, before Justice Joyce Abdulmalik of the Federal High Court, Abuja.

Those named in the charge are Major General Mohammed Ibrahim Gana (rtd), Captain (NN) Erasmus Ochegobia Victor (rtd), Inspector Ahmed Ibrahim, Zekeri Umoru, Bukar Kashim Goni, and Abdulkadir Sani.

Also listed as a defendant, but said to be at large, is former Minister of State for Petroleum Resources, Timipre Sylva.

The charge, filed by the Office of the Attorney-General of the Federation and signed by the Director of Public Prosecutions of the Federation, Rotimi Oyedepo, SAN, accuses the defendants of offences ranging from treason and terrorism to failure to disclose security intelligence and money laundering linked to terrorism financing.

At the centre of the case is an allegation that the defendants conspired in 2025 to undermine the Nigerian state.

According to the charge, they “conspired with one another to levy war against the state to overawe the President of the Federal Republic of Nigeria,” an offence punishable under Section 37(2) of the Criminal Code.

The prosecution further alleged that the defendants had prior knowledge of a planned treasonable act involving one Colonel Mohammed Alhassan Ma’aji and others but failed to alert authorities.

The charge stated that they, “knowing that and intended to commit treason, did not give the information thereof with all reasonable despatch to either the President or a Peace Officer.”

In another count, the defendants were accused of failing to take preventive steps, as they allegedly “did not use any reasonable endeavours to prevent the commission of the offence.”

Beyond treason, the Federal Government is prosecuting the defendants for terrorism-related offences under the Terrorism (Prevention and Prohibition) Act, 2022.

The charge alleged that they “conspired with one another to commit an act of terrorism in the Federal Republic of Nigeria.”

Particularly, Inspector Ahmed Ibrahim and Zekeri Umoru are accused of participating in meetings linked to terrorist activities.

Prosecutors claim they acted “in a bid to further a political ideology which may seriously destabilise the constitutional structure of the Federal Republic of Nigeria.”

The charge also accused the defendants of providing support for terrorism, alleging that they “knowingly and indirectly rendered support” to facilitate acts of terror.

In addition, the prosecution alleged a deliberate suppression of intelligence, stating that the defendants “had information which would be of material assistance in preventing the commission of the act of terrorism but failed to disclose the information to the relevant agency as soon as practicable.”

The case further traced financial transactions allegedly linked to terrorism financing, with multiple defendants accused of handling proceeds of unlawful activities.
Bukar Kashim Goni is alleged to have “indirectly retained the aggregate sum of N50,000,000, which forms part of the proceeds of an unlawful act, to wit: terrorism financing,” while Abdulkadir Sani allegedly retained N2 million from a similar source.

Zekeri Umoru, according to the charge, “without going through a financial institution accepted a cash payment of the sum of N10,000,000,” and also retained an additional N8.8 million suspected to be proceeds of terrorism financing.

Inspector Ahmed Ibrahim was also accused of taking possession of N1 million linked to the same alleged scheme.

All financial-related counts were brought under the Money Laundering (Prevention and Prohibition) Act, 2022.

The 13-count charge presents what prosecutors describe as a coordinated network involving security personnel, civilians, and a politically exposed individual, allegedly connected to activities threatening national security.